10-Q 1 d10q.txt FORM 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q [ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the period ended July 31, 2001 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ________ to ________. Commission File Number: 0-18150 DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P. ---------------------------------------------- (Exact name of registrant as specified in governing instrument) Delaware 13-3244091 ---------- ---------------------------- (State of organization) (IRS Employer Identification No.) 2 World Trade Center, New York, NY 10048 ---------------------------------------- ------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (800) 829-8585 -------------- Former name, former address and former fiscal year, if changed since last report: not applicable Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ------- --------- PART I - FINANCIAL INFORMATION ------------------------------ Item 1. Financial Statements DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P. BALANCE SHEETS

See accompanying notes to financial statements. DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P. STATEMENTS OF OPERATIONS Three and nine months ended July 31, 2001 and 2000

See accompanying notes to financial statements. DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P. STATEMENT OF PARTNERS' CAPITAL Nine months ended July 31, 2001

See accompanying notes to financial statements. DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P. STATEMENTS OF CASH FLOWS Nine months ended July 31, 2001 and 2000

See accompanying notes to financial statements. DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P. Notes to Financial Statements 1. The Partnership --------------- Dean Witter Realty Income Partnership II, L.P. (the "Partnership") is a limited partnership organized under the laws of the State of Delaware in 1984. The Partnership's fiscal year ends on October 31. The Partnership's last remaining property investment was its 14.8% interest in the partnership ("TPA") which owned Taxter Corporate Park. TPA sold the Taxter property on May 23, 2000, and this sale has effectuated the dissolution of the Partnership. However, the Partnership can't wind up its affairs, and distribute the balance of the Partnership's cash reserves, until TPA terminates its operations (see Note 2). The Managing General Partner plans to terminate the Partnership in 2001. The equity method of accounting had been applied to the Partnership's 14.8% interest in TPA because of the Partnership's continuing ability to exert significant influence over TPA. The Partnership's records are maintained on the accrual basis of accounting for financial reporting and tax reporting purposes. Net (loss) income per Unit of limited partnership interest amounts are calculated by dividing net (loss) income allocated to Limited Partners by the weighted average number of Units outstanding. In the opinion of management, the accompanying financial statements, which have not been audited, include all adjustments necessary to present fairly the results for the interim period. Except for the gain on sale of the Taxter property included in equity in earnings in 2000, such adjustments consist only of normal recurring accruals. These financial statements should be read in conjunction with the annual financial statements and notes thereto included in the Partnership's annual report on Form 10-K filed with the Securities and Exchange Commission for the year ended October 31, 2000. Operating results of interim periods may not be indicative of the operating results for the entire year. DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P. Notes to Financial Statements 2. Investment in Joint Venture --------------------------- The Partnership understands that TPA has certain operating issues that TPA must resolve, both with the buyer of the Taxter property and other third parties, before TPA can terminate its operations. Resolution of these issues is not anticipated to require any significant funding from the Partnership. Summarized income statements of TPA are as follows:

3. Related Party Transactions -------------------------- An affiliate of the Managing General Partner performs administrative functions, processes investor transactions and prepares tax information for the Partnership. For the nine months ended July 31 2001 and 2000, the Partnership incurred approximately $46,000 and $81,000, respectively, for these services. These amounts have been recorded in general and administrative expenses. The 2001 fees are also included in accounts payable and other liabilities as of July 31, 2001. 4. Cash Distribution ----------------- On February 27, 2001, the Partnership distributed, 100% to Limited Partners, approximately $602,000 ($3.40 per Unit), which represents the remaining balance of previously undistributed proceeds from the sales of the Taxter, Pavilions at East Lake and Glenhardie properties (sold 2000, 1999, and 1998, respectively). DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL ------- ------------------------------------------------- CONDITION AND RESULTS OF OPERATIONS ----------------------------------- Liquidity and Capital Resources ------------------------------- As discussed in Note 1 to the Financial Statements, the partnership ("TPA") which owned the Taxter office property sold the property on May 23, 2000. The Partnership's interest in TPA was the Partnership's only remaining property interest. The Partnership dissolved pursuant to the terms of its Partnership Agreement, effective May 23, 2000, the date on which the Taxter property was sold. The Partnership plans to wind up its affairs, distribute its remaining cash reserves and terminate its existence by filing a certificate of cancellation in the office of the Delaware Secretary of State in 2001. As discussed in Note 4 to the Financial Statements, on February 27, 2001, the Partnership paid, to Limited Partners only, a distribution of $3.40 per Unit. The Partnership believes that its cash reserves are adequate for its needs until it is terminated. Except as discussed above and in the Financial Statements, the Managing General Partner is not aware of any trends or events, commitments or uncertainties that may have a material impact on liquidity. Operations ---------- Fluctuations in the Partnership's operating results for the three and nine month periods ended July 31, 2001 compared to 2000 are primarily attributable to the following: The decreases in equity in earnings of joint venture in 2001 are due to the loss of operating income from TPA after its sale of the Taxter property in May 2000. Also, the Partnership's share of the gain on sale of the Taxter property (approximately $2.5 million) was included in the equity in earnings of joint venture amounts in 2000. The decreases in interest and other revenues in 2001 compared to 2000 were primarily due to the absence of third quarter 2000 interest earned on the Taxter sale proceeds until such proceeds were distributed to Limited Partners. DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P. The negative property operating expenses in 2001 were primarily caused by the collection of tenant receivables which were previously written off by the Partnership. There were no other individually significant factors which caused changes in revenues or expenses. Inflation --------- Inflation has been consistently low during the periods presented in the financial statements and, as a result, has not had a significant effect on the operations of the Partnership or its properties. DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P. PART II - OTHER INFORMATION --------------------------- Item 6. Exhibits and Reports on Form 8-K a) Exhibits None b) Reports on Form 8-K None DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned there unto duly authorized. DEAN WITTER REALTY INCOME Partnership II, L.P. By: Dean Witter Realty Income Properties II Inc. Managing General Partner Date: September 11, 2001 By: /s/E. Davisson Hardman, Jr. --------------------------- E. Davisson Hardman, Jr. President Date: September 11, 2001 By: /s/Raymond E. Koch ------------------ Raymond E. Koch Vice President, Assistant Secretary and Controller (Principal Financial and Accounting Officer)

WITTER DEAN REALTY INCOME PARTNERSHIP II LP 10-Q